All Forum Posts by: Steve Osowicz

@Brandon Gamblin yes to what @Curt Davis said. If it is an independent or small regional bank they might deal directly with agents. However a lot of large regional or national banks will have a third party basically go through the "vetting" process for them. Some of the information they will require is; company revenue, length of time in real estate, experience with REO's, copies of E & O insurance, copies of licenses, etc etc etc. The application is very extensive, even after completing it, there are likely agents who are already in the third party system that the banks have used previously and would continue to use. If you want to get an idea of the depth of the application process you can go to homepath.com (Fannie Mae) or homesteps.com (Freddie Mac), there is a section for agents. As a side note, you can also view Fannie and Freddie inventory from those sites as well.

@Max Balesteri there are many, many questions, I'll try to name a few I would want to know. 

1. Ask if they do in-house maintenance or do they contract out all repairs. 

2. At what level do they need your approval to conduct repairs (i.e. if something is going to cost over $200.00 do they call you first).

3. What is their process for past due rent - collections - and lease violations. 

4. On top of what @Curt Davis said, get a list of all fees they charge - lease up fee - marketing fee - anything you might be charged for, though all this should be in the management agreement. 

5. If they have an indemnity clause and how it is written (do you the investor shoulder all of the burden in a legal dispute). 

6. When is rent due, when is your distribution sent if the tenant pays on time/and when if the tenant is late? What is the late fee policy and who receives the money from late fees? Is is check or direct deposit?

7. Do they provide online statements or do they mail out a monthly statement? 

Some other tips - before deciding get a proposal from 3 different companies make sure they include their fees - along with a copy of their management agreement and lease so you can review and compare them. I am not saying paying higher fees is necessarily bad if it give you peace of mind and the company does a good job, just make sure you don't get any surprises - tenants can be surprising enough. 

@Account Closed These are the sources I use - Godaddy.com for registering the domain (i.e. yourdomain.com), you can normally google deals or coupons and get the first year heavily discounted. Then you need a host, though Godaddy offers hosting I use bluehost.com, if you use this method you will need to point your nameservers from godaddy to bluehost (it sounds complicated but is not). Bluehost has a link for you to use wordpress to find a theme download info and start editing your site. If you are feeling more adventurous, just get a text editor (i.e. notepad++ or sublime text) and write your own html and css (there are many youtube videos that can guide you through this process).  

Now that the easy part is over (yes, that was the easy part) you will need to research SEO or Search Engine Optimization. This involves a number of methods, such as making sure you link your site to other sites you might have such as a facebook page, twitter, google plus and pintrest. This involves making sure that your site has what search engines consider valuable information. Other influencing factors are the number of unique visitors you have to your site. Yes, all of this can be done for less than $30 for the year, is it easy, no. If you decide to use a free site, unless you pay them your site will either include their advertisements or have their name in the domain i.e. yourdomain.freesite.com. 

Good Luck - use the internet you can find everything you need for creating your site. 

@Stephanie Muhammad I agree with the other posters, you have to move towards thinking in a positive way instead of negative. That being said do you have a more specific plan in mind? When you say "I want to do real estate" I don't know what that means. It is like someone saying "I want to be rich" but they never define what rich means. If you want to be a real estate agent, focus your efforts there first, if you want to find your first rental property, move in that direction. Once you have identified what "real estate" you want to do first work on attaining that goal. 

@Greg W. That looks like it could get out of hand, our lease stated no subletting. Does she just want to lease out a room or is it an expensive property? If not, and she basically just wants out, why not let her do the leg work to find a new tenant. Qualify the new tenant, once they pay their deposit and first months rent (or however you collect those funds), let her out of her lease and go forward with the new tenant. 

@Ryan Billingsley That is a common amount, one month's rent as a security deposit. Of course there will be those who want to "break" that amount up over several months for whatever reason. My opinion is not to do that, if the person has trouble with the deposit, any unforeseen financial circumstances they encounter could result in no rent for you (though I know others are ok with this). I found a link to a pdf of the tenant landlord law for Missouri, it has a section on security deposits. You should know the specifics of the law as well though, it looks like this is a broad overview. 

 http://ago.mo.gov/publications/landlordtenant.pdf

@Justin R. *I think you are good to go, what type of entity are you set up as? I think if you are an S-Corp or LLC you can pay yourself as an individual outside of that entity or pay the entity as the one who conducted the work (especially if you are the only owner), if Sole Proprietor just make sure you keep detailed records. Also remember if you pay a contractor (for rental property) over $600, not on a credit card in a year, you will need to send them a 1099-MISC. *Please note, nothing commented on should be construed as legal or tax advice, you should and I encourage that you seek out qualified legal and tax professionals to aim you in the right direction.

As far as hourly rate for what I would call non-skilled labor, there is a very wide chasm in Louisville, from $10.00 on up. Maybe you would be better served to price it per job or have a list you create and use that states charges you can go back to. For example - painting - $100.00 per bedroom, larger rooms higher cost. Clean stove - $25, clean fridge $25 etc etc. If you really want to know what others would charge, call up 3 different contractors, cleaners, handymen and compare the 3, normally 1 is way off and the other 2 are close you can get a good idea of an amount to charge. 

 This - though you need to make sure you are very familiar with your local laws, I always recommend an attorney to review your process and procedures. I know there are different policies people have about late fees. Some are a set fee at different intervals, like $25 after 5 days, $25 more dollars or a percentage of rent, or a daily amount until rent is paid. The issue that you have is that you did not set a precedence at the beginning, since you kept accepting rent without late fees. My opinion (as long as it complies with your local laws) is you should send them a letter, certified, keep a copy stating the late fee policy as well as the penalties and advise that next month this will be strictly enforced. Locally if late fees got to be around 10% of the rent amount for that month my attorney recommended stopping there, as a judge might not look favorably on that (excessive late fees). In addition, here in Kentucky if you accept money you are restarting the time frame for the eviction process. Which is why we did not allow tenants to deposit the money directly to the bank. As a side note, we also had a no cash policy (for those with no bank account for check or ach - there are money orders), that way we had records of payments. 

Yes, but I am biased, since I very much enjoy real estate, not only will you learn a tremendous amount, you will often have access to the best deals, before they even hit the market, due to other agents in your office or people coming to you for advice. Real estate is my full time gig, but you could as many people do here in Kentucky - work a full time job or go to school and do real estate part-time. 

It can't hurt to go ahead and get your degree though, as a matter of fact, you may want to check on the requirements for your state, maybe you can choose some real estate classes as electives that will count towards your license education requirement. 

@Craig Fithian you can utilize the internet to help define your target area. If you are concerned about crime, use louisvilleky.gov they have a crime map that allows you to determine the type and amount of criminal activity for an area. If you are looking for property values and other demographic information such as income, you can look on the site city-data.com and use the map feature to examine different areas of the city.